Robert M. Solow [Ideological Profiles of the Economics Laureates] Daniel B

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Robert M. Solow [Ideological Profiles of the Economics Laureates] Daniel B Robert M. Solow [Ideological Profiles of the Economics Laureates] Daniel B. Klein and Ryan Daza Econ Journal Watch 10(3), September 2013: 632-640 Abstract Robert M. Solow is among the 71 individuals who were awarded the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel between 1969 and 2012. This ideological profile is part of the project called “The Ideological Migration of the Economics Laureates,” which fills the September 2013 issue of Econ Journal Watch. Keywords Classical liberalism, economists, Nobel Prize in economics, ideology, ideological migration, intellectual biography. JEL classification A11, A13, B2, B3 Link to this document http://econjwatch.org/file_download/775/SolowIPEL.pdf ECON JOURNAL WATCH Kotlikoff, Laurence J. 2011. The Purple Health Plan. Open letter. Link Samuelson, Paul A. 1947. Foundations of Economic Analysis. Cambridge, Mass.: Harvard University Press. Smith, Vernon L. 2002. Interview by Mike Lynch and Nick Gillespie. Reason, December: 34-39. Smith, Vernon L. 2003a. Autobiography. In Les Prix Nobel: The Nobel Prizes 2002, ed. Tore Frängsmyr. Stockholm: Nobel Foundation. Link Smith, Vernon L. 2003b. Interview. Region Focus (Federal Reserve Bank of Richmond), Spring: 32-35. Smith, Vernon L. 2003c. Interview by Jeremy Clift. Finance & Development (International Monetary Fund), March: 6-8. Smith, Vernon L. 2008. Discovery—A Memoir. Bloomington, Ind.: AuthorHouse. Smith, Vernon L. 2009. Autobiographical chapter in Lives of the Laureates: Twenty- three Nobel Economists, 5th ed., eds. William Breit and Barry T. Hirsch. Cambridge, Mass.: MIT Press. Smith, Vernon L. 2010. Big Think Interview with Vernon Smith. Big Think, January 12. Link Smith, Vernon L. 2013. Email correspondence with Daniel Klein, April 19. Smith, Vernon L., Terry L. Anderson, and Emily Simmons. 1999. How and Why to Privatize Federal Lands. Cato Policy Analysis 363. December 9. Cato Institute (Washington, D.C.). Link Smith, Vernon L., and Nick Gillespie. 2011. Reason.tv: Nobel Prize-Winning Economist Vernon Smith on Experimental Economics, Adam Smith, the Housing Bubble, and His Journey Towards Libertarianism. Hit & Run Blog, Reason, July 20. Link Smith, Vernon L., and Douglas Holtz-Eakin. 2012. Obamacare’s Flawed Economic Foundations. Wall Street Journal, March 20. Link Robert M. Solow by Daniel B. Klein and Ryan Daza Robert Solow (1924–) was born and raised in Brooklyn. Solow, who grew up in the 1930s, has written that “all my mother and father talked about together was where the next dollar would come from” (Solow 2009a, 115). Solow’s parents were New Deal Democrats (Solow 2013c), as is, it has been said, Solow himself (Samuelson 1989, 95). He considers himself a liberal Democrat today, saying in his response to our questionnaire that his outlook has been quite constant since the age of 25 (Solow 2013c). jump to navigation table VOLUME 10, NUMBER 3, SEPTEMBER 2013 632 IDEOLOGICAL PROFILES OF THE ECONOMICS LAUREATES Solow says that a high school teacher’s influence taught him to never have “a moment’s sympathy for the Soviet Union (nor for Trotskyism—for me the rot set in with Lenin or before)” (Solow 2013c). He reflected on the times: I can certainly say that everyone in Brooklyn in the 1930s was interested in economics. And not only in economics: intelligent high school students of my day were conscious not only of the Great Depression but also of the the rise of Fascism and Nazism, events that were certainly not independent of the worldwide depression. It was an obvious fact of life to us that our society was malfunctioning politically and economically and that nobody really knew how to explain it or what to do about it. (Solow 2009b, 154) Solow went to Harvard for his undergraduate studies, but his education was interrupted by World War II when he volunteered for the Army. At the end of the war he returned to Harvard and decided to finish as an economics major (Solow 2009b, 156). Solow then earned his Ph.D. from Harvard and took a faculty position at MIT, where he has remained throughout his career. In an interview with Arjo Klamer, Solow described his undergraduate years at Harvard: I began to study sociology, anthropology, and some economics. I had very good teachers in those subjects, such as Talcott Parsons, the sociologist, and Clyde Kluckhohn, with whom I became very close friends. I also had a course with Paul Sweezy, who was a favorite economics teacher of mine…and I think I was a favorite student of his. I was fairly left wing at that time. (Solow 1984, 128) Klamer comments: “You said you were a left winger as an undergraduate and that you liked Paul Sweezy. You must have changed quite a bit….” Solow responds: “Well…yes and no. I still think of myself as a left of center person. I still don’t find it a particularly attractive notion that property rights should take precedence over all other rights” (Klamer 1984, 130). Klamer asks “Why?,” and Solow continues: That is a long evolution. As a student of Paul Sweezy’s, I was excited by Marxian economics. As I studied economics I came more and more to the conclusion that there is really no good economics in Marxism; Marxian economics has been a failure as an economic theory. For a longer time I found something useful in the notion of historical materialism, that ideas tend in a large part to reflect interests—vulgar jump to navigation table 633 VOLUME 10, NUMBER 3, SEPTEMBER 2013 ECON JOURNAL WATCH Marxism, so to speak. There is something to that, though it’s far from the complete story. My first intellectual influence was a high school teacher who had been anarchist. So I never felt the slightest attraction to Stalinism or Soviet communism. I was once at Oxford and went to a seminar…it was in 1968 so the place was filled with radicals. They asked what I thought of Marxism, and I said that Marxism made pseudo-science of one insight that Proudhon had, namely that property is theft. Locke saw the institution of private property as a great thing because it was a way of protecting private citizens against the encroachments of aristocratic power. There is still a lot of value to that. The danger of socialism is the concentration of political and economic power in the same hands. Nevertheless, I still believe that the institution of private property has to keep proving itself. For that matter, capitalism still has to keep proving that it can be economically efficient without being destructive of reasonable equality. I am not anti-socialist in any absolutist way but I am not a socialist either, because I do not think that socialism is a practical prospect for a good society. If there were an opportunity for demo- cratic socialism somewhere, I would be willing to see it given a try. I am not pessimistic about the managed capitalism that you find in northern European countries. They have learned to combine activist economic policy with democracy. I don’t see that the Dutch or the Norwegians have less liberty, all things considered, than we do. (Solow 1984, 130-131) Solow’s graduate thesis was “an exploratory attempt to model changes in the size distribution of wage income using interacting Markoff processes for employment-unemployment and wage rates” (Solow 1988). He is most well- known for his modeling of economic growth, which is also what earned him the Nobel Prize. Solow was a senior economist on the Council of Economic Advisers to President John F. Kennedy from 1961 to 1963. Writing in 1974 about the welfare programs promulgated by the Kennedy and Johnson Administrations, and specifically about President Johnson’s Great Society initiative, Solow and Eli Ginzberg said: “It seems to us that no one who reads the evidence in the preceding essays can seriously subscribe to either of the extreme, simple, fashionable dogmas: that social legislation is merely a sham, aimed at camouflaging, not solving, problems; or that all major political intervention in social problems is a mistake, bound to fail, and better left to local government, jump to navigation table VOLUME 10, NUMBER 3, SEPTEMBER 2013 634 IDEOLOGICAL PROFILES OF THE ECONOMICS LAUREATES private charity, or the free market. Contrary to these dogmas, the evidence seems to show that the problems are real, that the political pressure to do something about them is often irresistible, and that many partial, but genuine successes have been achieved” (Ginzberg and Solow 1974, 220). They concluded: “The record of the Great Society is one of success mixed with failures, of experiments that proved themselves at least partly successful and experiments whose returns do not appear to have justified the effort. In other words, it turned out about as any sensible person should have expected” (ibid.). In 1996, Solow was a critic of welfare reform as drafted and passed. He admitted the reform appears to have worked better than he anticipated at getting people back into the labor market, but pointed out that it was hard to judge because the reform had been “launched in the midst of [an] incredible boom” (Solow 2002, 33). Solow said he opposes time limits on welfare (ibid.). Asked in a symposium to name the “most significant contributions” to economics during the 1900s, Solow (2001, 296) started his list with John Maynard Keynes’s General Theory. Solow says that as an economist Keynes “avoided ex- tremes,” “changed his mind often,” and “was not an ideologue”; by contrast, Solow describes Milton Friedman as “an ideologue, a True Believer” who was “bad for economics and bad for society” (Solow 2013b, 214-215). Solow also has his opinion of Hayek: [T]here was a Good Hayek and a Bad Hayek.
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